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Investing.com - Shares in American Airlines jumped more than 8% in early trading Tuesday, while United Airlines climbed about 2%, after media reports said United CEO Scott Kirby floated a possible combination of the carriers.
Citing people familiar with discussions on the matter, Bloomberg News reported that Kirby pitched the idea to senior government officials, and it remained unclear if there were any processes for an actual deal. Reuters also reported a similar development.
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United Airlines (NASDAQ:UAL) and American Airlines (NASDAQ:AAL) are the second and fourth-largest U.S. airlines by market capitalization, with any potential merger standing to create the country’s biggest carrier, above Delta Airlines. The two also have the largest fleets among U.S. airlines with more than 1,000 aircraft each.
The Bloomberg report noted that such a merger would likely face intense scrutiny over its competition effects, even under the business-friendly Trump administration.
A potential merger also stands to further consolidate the U.S. domestic carrier market, which is controlled by American, Delta, United, and Southwest.
(Ambar Warrick and Scott Kanowsky contributed to this report.)
